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United States v. Williams

June 8, 1984

UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,
v.
ROY L. WILLIAMS, THOMAS F. O'MALLEY, ANDREW G. MASSA, JOSEPH LOMBARDO, DEFENDANTS-APPELLANTS



Eschbach, Posner and Coffey, Circuit Judges.

Author: Eschbach

ESCHBACH, Circuit Judge.

Roy Williams, Joseph Lombardo, Thomas O'Malley, and Andrew Massa appeal from convictions on all 11 counts of an indictment charging conspiracy to bribe a United States Senator, 18 U.S.C. § 371, interstate travel to promote the bribery, 18 U.S.C. § 1952, and wire fraud, 18 U.S.C. § 1343. Only Lombardo attacks the sufficiency of the evidence. All defendants, however, contend that the district court erred (1) in denying a motion to suppress evidence obtained through electronic surveillance, (2) in ruling on several evidentiary matters, (3) in handling ex parte juror contacts, (4) in instructing the jury, and (5) in denying a request for a new trial. Finding no merit in these contentions, we affirm.

I.

Many aspects of this case are extraordinary. For instance, the trial lasted nearly two months, and the jury charge an hour and a half. Moreover, the parties made over 200 written motions to the district court, which gave each motion individual attention. Amid this complexity, the government's theory of criminal culpability is strikingly clear: the defendants, Allen Dorfman,*fn1 and William Webbe, an unindicted co-conspirator, devised and pursued a scheme to bribe a United States Senator at the expense of the Teamsters' Central States Pension Fund.*fn2 Viewing the evidence in the government's favor, see Glasser v. United States, 315 U.S. 60, 80, 86 L. Ed. 680, 62 S. Ct. 457 (1942), we now describe the events that support this charge and the defendants' convictions.

The Teamsers' Central States Pension Fund ("Pension Fund" or "Fund") is an organization created by and funded pursuant to collective bargaining agreements between the Teamsters Union and employers. As the name implies, the Pension Fund pays benefits to retired union members. In 1972, the Pension Fund acquired what is known as the Wonderworld property -- a 5.8 acre plot of land in Las Vegas, Nevada. The Pension Fund, however, lost direct control over the management and disposition of this property in 1977, when the Victor Palmieri Company ("Palmieri") was retained to manage the Fund's real estate assets. The Pension Fund's trustees, as part of an effort to retain the Fund's tax-exempt status, relinquished managerial control to Palmieri and retained only the right to monitor Palmieri and to remedy breaches of fiduciary duties.

In 1978, when Palmieri decided to sell the Wonderworld property, nearby homeowners became concerned that a high-rise building would be constructed on the land. The homeowners thus organized and selected as their spokesman Senator Howard Cannon, whose home was across the street from the Wonderwold property. The group decided to purchase the land with a view toward having the property "down-zoned." At a homeowners' meeting, Senator Cannon offered to call Allen Dorfman to discover whether the group could buy the property directly from the Pension Fund. At the time, Allen Dorfman was not formally associated with the Fund; however, his insurance company, which had offices in the same building that housed the Pension Fund, previously insured many of the Fund's assets.Senator Cannon also suggested that his son-in-law, Robert Bjornsen, could serve as the group's agent for the Wonderworld transaction. The homeowners agreed and Bjornsen initiated contacts with Palmieri in late December of 1978.

On January 8, 1979, Palmieri invited sealed bids from parties who had expressed interest in the Wonderworld property. The bid-solicitation letter stated several conditions, including that the minimum bid was $1,400,000. Before Bjornsen submitted a bid on behalf of the homeowners, however, Senator Cannon met in his Las Vegas office with Allen Dorfman, Roy Williams, then an international vice-president of the Teamsters Union,*fn3 and Edward Wheeler, a lawyer who represented the Teamsters on legislative matters.

At this meeting, which occurred on January 10, 1979, Wheeler voiced the Teamsters' objection to the deregulation of the trucking industry -- a nascent proposal in Congress. After he completed his presentation, Wheller heeded Williams' request and left the Senator's office. Williams, Dorfman, and Senator Cannon continued to meet for another 25 to 45 minutes. The three men discussed the Wonderworld property and the homeowners' effort to purchase the land. Williams and Dorfman, seeking to influence Senator Cannon's actions and decisions on the deregulation legislation, offered the Senator and his group the exclusive right to purchase the Wonderworld property at a price of $1,400,000. Over the next four months, the defendants, Allen Dorfman, and Dorfman's associate William Webbe, worked to keep this promise.

Robert Bjornsen, on behalf of the homeowerns, submitted to Palmieri a $1,400,00 bid on January 12, 1979. The bid, however, was rejected for failure to conform to Palmieri's requirement of full payment within one year. Palmieri also rejected a $1,600,000 bid from investor Allen Glick because he failed to submit the requisite personal-finance statement. Receiving no complying bids, Palmieri decided to pursue further negotiations with Bjornsen, the homeowners' agent, and Glick, the high bidder.

Palmieri and Glick appeared to reach an agreement. Glick orally made a new offer for $1,600,000 and agreed to raise the down payment from $400,000 to $800,000. On January 29, 1979, a Palmieri representative accepted this offer and closing documents were mailed to Glick's attorney. Before the purchase agreement was executed, however, Glick withdrew his offer.

A concerted effort by the four defendants led to Glick's withdrawal. Early in the afternoon on January 30, 1979, Joseph Lombardo, whose vocational status is something of a mystery, made a proposal to Allen Dorfman to send people from the Pension Fund to speak with Glick. In particular, Lombardo named as emissaries Thomas O'Malley, then a trustee of the Fund, and Andrew Massa, a former trustee. Roy Williams approved the trip and made an airplane available to O'Malley and Massa.

Later that same day, O'Malley and Massa did fly to California to meet with Glick. During a dinner meeting, O'Malley and Massa frankly described their intentions. They told Glick that a homeowners' group headed by Senator Cannon wanted to buy the Wonderworld property. The two men further informed Glick that there was legislation pending before a Senate committee chaired by Senator Cannon that would harm the trucking industry and that they wanted the legislation defeated. To secure Senator Cannon's appreciation, therefore, O'Malley and Massa asked Glick to withdraw his $1,600,000 offer.Glick readily agreed to withdraw the outstanding offer, but made it known that his partner, Fred Glusman, might wish to continue his own efforts to purchase the property.

The next day Glick withdrew the offer on the Wonderworld property and suggsted to Glusman that he refrain from individually pursuing the land.From the conspirators' point of view, therefore, prospects appeared promising on February 9, 1979, when Bjornsen submitted another offer on behalf of the homeowners. The purchase offer was again for $1,400,000 and included a sizeable commission to be paid to Bjornsen's company. Undeterred by Glick's suggestion, however, Glusman made an offer for $1,600,000. Accordingly, the homeowners' offer was rejected and Palmieri proceeded to close the deal with Glusman.

Before the deal was completed, Glusman was again contacted by Glick who told Glusman not to "fight city hall." Evidently not prepared for such a contest, Glusman withdrew his offer on February 15, 1979. Thus by the beginning of March, the slate was clean and Palmieri resumed negotiations with Bjornsen.

By that time, however, it seemed plain that the Wonderworld property would be "down-zoned"; consequently, the homeowners' group lost interest in buying the property and disbanded. Dorfman and Webbe, determined to keep a promise made to Senator Cannon, then helped Bjornsen find a new partner for the desired purchase -- Robert L. Smith, who was a Las Vegas contractor and business associate of Dorfman. Bjornsen submitted a series of three bids on behalf of "Robert L. Smith"; each was for $1,400,000 and each was rejected by Palmieri for providing an insufficient down payment. Throughout this final stage of the conspiracy, Dorfman and Williams lamented their inability to fulfill the commitment made to Senator Cannon. Yet as late as May 21, 1979, Dorman assured the Senator that the deal was still "wide open."

On May 25, 1979, Palmieri accepted American National Development Corporation's offer to pruchase the Wonderworld property for $1,600,000. On July 2, 1979, the property was sold to that corporation.

On May 22, 1981, the defendants were charged in all counts of an 11-count indictment. Count I charged the defendants with a conspiracy to bribe a United States Senator, 18 U.S.C. § 371. Count II charged the defendants with causing O'Malley and Massa to travel iln interstate commerce to California, with the intent to promote the bribery, 18 U.S.C. § 1952.Counts III to XI charged the defendants with the use of interstate wires for the purpose of executing a scheme to defraud the Pension Fund of its "right to the conscientious, loyal, faithful, disinterested, and unbiased services of Thomas F. O'Malley," 18 U.S.C. § 1343.

The district court denied the defendants' motions to dismiss the indictment, see United States v. Dorfman, 532 F. Supp. 1118 (1981), and to suppress evidence obtained through electronic surveillance, see United States v. Dorfman, 542 F. Supp. 345 (1982). A jury trial was held and the defendants were found guilty as charged in all counts of the indictment.Williams received the maximum sentence of 55 years in prison, but this sentence was imposed pursuant to 18 U.S.C. § 4205(c) to permit a study of Williams' health. The district court indicated that when the study is complete, Williams' sentence will be reduced. Lombardo was sentenced to a prison term of 15 years, O'Malley to a term of 30 months, and Massa to one year.

II.

The government's evidence at trial consisted in large measure of conversations surreptitiously intercepted and recorded pursuant to court orders and the provisions of Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510 to 2520 ("Title III"). The defendants, blending constitutional and statutory arguments, maintain that this evidence was illegally obtained and introduced at trial. Before we address these arguments, however, we briefly describe the government's electronic investigation.

A.

On January 29, 1979, the government, through a special attorney for the Department of Justice, applied for Title III authority to place a wiretap on telephones at the Amalgamated Insurance Agency, which was Dorfman's place of business. The application stated that there was probable cause to believe that Dorfman and others were illegally "conspiring to establish, promote, manage, and/or receive compensation from hidden interests in one or more Reno and Las Vegas, Nevada, gambling casinos." 542 F. Supp. at 370. The application, which was made to the Chief Judge of the United States District Court for the Northern District of Illinois, was supported by an affidavit of FBI Special Agent Peter Wacks. Wacks' affidavit, in turn, was based on reports from six confidential informants and one James Fratianno. The Chief Judge granted the application and the surveillance commenced.

The initial surveillance order expired after 30 days; thus on March 1, 1979, the government applied to the district court for authority to continue intercepting telephone calls. This application repeated the initial allegations concerning hidden interests in casinos. The application, however, added the Aladdin hotel-casino to the list.This new allegation was made in an affidavit of Special Agent Wacks and supported by transcripts of conversations intercepted pursuant to the initial court order. The Chief Judge granted the March 1, 1979, application and authorized 30 more days of wiretaps.

A series of 30-day authorizations followed throughout 1979 and into 1980. Not until the application of April 28, 1979, did the government allege that Dorfman and others were involved in a conspiracy to bribe Senator Cannon. We close this brief history by noting that on April 7, 1979, the government obtained its most effective Title III authority -- a court order that permitted the placement of electonic-listening devices in the offices of Dorfman and William Webbe.

The defendants have brought up from the district court's suppression proceedings essentially two arguments. First, they assert that the government's March 1, 1979, application did not satisfy Title III's requirements and, in any event, was supported by an affidavit containing a deliberate or reckless misrepresentation. Second, they contend that the Fourth Amendment required the suppression of conversations recorded prior to April 28, 1979, when the government first alleged the existence of a conspiracy to bribe Senator Cannon. We now consider, and ultimately reject, these positions.

B.

The government supported its March 1, 1979, Title III application with the same allegations and probable-cause showing made to obtain the original surveillance order. An extension application is not complete, however, if it only duplicates the original submission. The authorizing judge must be sufficiently informed about the results of the prior interceptions to answer intelligently the question whether probable cause exists to believe relevant conversations will be intercepted in the future. Accordingly, 18 U.S.C. § 2518(1)(f) requires that the extension application contain a statement of results previously obtained, or an explanation of the failure to obtain results. Ruling on the defendants' motion to suppress, the district court held that the government's application of March 1, 1979, "did not contain the required explanation." 542 F. Supp. at 374.

The government asserts that the district court overlooked a statement in the March 1, 1979, application that "[d]uring the entire period of this court's order for the interception of wire communications, the main subject of the investigation, Allen Dorman, was out of the State of Illinois." In the government's view, this declaration is a "reasonable statement of the failure to obtain . . . results," 18 U.S.C. § 2518(1)(f).

There is good reason to doubt that the brief reference to Dorfman's absence was sufficient to satisfy 18 U.S.C. § 2518(1)(f). For instance, the statement was made in the context of (incorrectly) asserting that conversations relating to the January 29, 1979, allegations had been intercepted. We would thus hesitate to hold that the government's application fairly explained the results of prior surveillance to allow an intelligent probable-cause determination. We need not so hold, however, because the March 1 application was not founded solely on a renewal of the initial (January 29) allegations.

As we noted above, allegations concerning the Aladdin hotel-casino were made first in the March 1 application. Special Agent Wacks alleged in his affidavit that the FBI had intercepted conversations pursuant to the January 29 wiretap order that "concerned the promotion and management of hidden and unlawful interests in the Aladdin hotel-casino." Wacks provided the court with transcripts of the conversations, biographical information on the participants, and the meaning of certain veiled references.

Wacks' allegations and the transcripts of conversations formed an ample basis for the Chief Judge's probable-cause finding under § 2518(3).*fn4 The one-month-old allegations concerning other casinos were surplus, and any failure to explain the lack of intercepted calls to substantiate the January 29 allegations was rendered immaterial. Apart from the purportedly inadequate § 2518(1)(f) explanation, the defendants cite, and we have discovered, no other statutory deficiency in the government's March 1 submissions. All predicates for a Title III order were thus satisfied and the Chief Judge properly issued the wiretap authorization.

The Supreme Court's decision in United States v. Giordano, 416 U.S. 505, 40 L. Ed. 2d 341, 94 S. Ct. 1820 (1974), which is cited by the defendants, does not compel a contrary conclusion. The Court in that case suppressed evidence intercepted under a Title III extension order because the extension was dependent on evidence illegally obtained pursuant to an initial order. The instant case, by contrast, involves only valid orders issued on applications meeting Title III's requirements. There is no basis for invoking the suppression remedy to punish the government for a deficient (if it was) § 2518(1)(f) statement, which was inessential to the showing of probable cause and the issuance of the March 1 wiretap order.

Special Agent Wacks' allegation in his March 1 affidavit that conversations were intercepted concerning the "promotion and management of hidden and unlawful financial interests in the Aladdin hotel-casino" proved to be false. The conversations allegedly involving the Alladdin hotel-casino turned out to involve the defendants' and Allen Dorfman's efforts to direct the Wonderworld property to the homeowners' group headed by Senator Cannon. The defendants use this misrepresentation as their primary weapon in the attack on evidence intercepted pursuant to the March 1 wiretap order.

In challenging Wacks' affidavit in the district court, the defendants' task was defined by Franks v. Delaware, 438 U.S. 154, 171, 57 L. Ed. 2d 667, 98 S. Ct. 2674 (1978): they had to prove that the Alladin allegations were intentional lies or made with reckless disregard for the truth.*fn5 See also United States v. Gaertner, 705 F.2d 210, 212 (7th Cir. 1983), cert. denied, 464 U.S. 1071, 104 S. Ct. 979, 79 L. Ed. 2d 216 (1984). We know what intentional lies are, but the meaning of "reckless disregard for the truth" is not self-evident, and the Court in Franks did not define the concept. We do know, however, that recklessness is not negligence, see Franks, 438 U.S. at 171, and that the Court has clarified the notion of reckless disregard in the context of First Amendment cases involving libel. We thus agree with the District of Columbia Circuit, see United States v. Davis, 199 U.S. App. D.C. 95, 617 F.2d 677, 694 (1979), that the First Amendment definition should be applied by analogy in the Franks setting. Accordingly, to prove reckless disregard for the truth, the defendants had to prove that the affiant "in fact entertained serious doubts as to the truth of his" allegations. St. Amant v. Thompson, 390 U.S. 727, 731, 88 S. Ct. 1323, 20 L. Ed. 2d 262 (1968). Because states of mind must be proved circumstantially, a factfinder may infer reckless disregard from circumstances evincing "obvious reasons to doubt the veracity" of the allegations. See i d. at 732.

The district court held an extensive evidentiary hearing, applied the correct legal standards, and found that the defendants "failed to demonstrate that the incorrect March 1 Aladdin allegations were either intentional misrepresentations, or made with reckless disregard for the truth." United States v. Dorfman, 542 F. Supp. at 381. We may disturb this finding only if, after a review of the record, we find it clearly erroneous. See United States v. Wuagneux, 683 F.2d 1343, 1355 (11th Cir. 1982), cert. denied, 464 U.S. 814, 104 S. Ct. 69, 78 L. Ed. 2d 83 (1983), United States v. Lefkowitz, 618 F.2d 1313, 1317 (9th Cir.), cert. denied, 449 U.S. 824, 66 L. Ed. 2d 27, 101 S. Ct. 86 (1980); United States v. Cruz, 594 F.2d 268, 272 (1st Cir.), cert. denied, 444 U.S. 898, 62 L. Ed. 2d 133, 100 S. Ct. 205 (1979).

A review of conversations intercepted pursuant to the January 29 wiretap order demonstrates that the government's Aladdin allegations were not manufactured from whole cloth. On January 31 and February 1, the government intercepted communications between one "Sandy" and David Dorfman, Allen Dorfman's son and associate. On January 31, the two discussed an attempt being made by Colonial Commercial Credit Corporation to refinance the Aladdin hotel-casino.They expressed concern about a completing refinancing proposal and a mysterious "source" of funds. The conversation intercepted on February 1 indicates that Sandy talked about the Aladdin with Allen Dorfman, who stated that the "deal" was "dead," but who still planned a future meeting regarding the matter.

Beginning on January 30, and continuing throughout February, the government also intercepted calls concerning a "bid" on a piece of property. Allen Dorfman, Joseph Lombardo, William Webbe, and another person were overheard on January 30 talking about sending Thomas O'Malley and Andrew Massa to speak with an unnamed person about a "bid" that they wanted "handled." In a series of calls that followed, the government learned more about the handling of this bid: a man named Glick was the bidder on the property and Allen Dorfman succeeded in securing Glick's withdrawal. The government further learned on February 13 that a bid had been rejected by "Palmieri. "

The convesations by themselves could have led a reasonable person to conclude that Allen Dorfman and his associates were involved in an effort to acquire, promote, or manage a hidden interest in the Aladdin hotel-casino. And Special Agent Wacks' investigation revealed further facts to support such a thesis. He learned that the "Glick" in the conversations with Allen Glick, the president of Argent Corporation, which owned several Las Vegas hotel-casinos. Wacks also learned that "Palmieri" was a firm that managed the Pension Funds's real estate assets, that the Pension Fund made loans to and had a interest in the Aladdin, and that O'Malley and Massa were Pension Fund officials. In light of the confluence of factors pointing to the Aladdin hotel-casino, and deferring to the district court's opportunity to observe the testimony of Special Agent Wacks and other investigators, we cannot term clearly erroneous the finding that the government's March 1 Aladdin allegations were not intentional or reckless misrepresentations.

The defendants primarily point to two items as compelling a contract result. First, they note that Special Agent Wacks erroneously stated in his March 1 affidavit that conversations substantiating the original January 29 allegations had been intercepted. The district court, however, accorded this fact "marginal probative value," 542 F. Supp. at 381 n.37, and we will not reweigh the evidence on appeal. Second, the defendants accord great significance to the fact that by March 1, Special Agent Wacks and other investigators knew that the "bid" referred to in the conversations was not on the Aladdin but, rather, on some "gold course" property. The March 1 affidavit, however, did not state that the bid was on the Aladdin. The government gave the Chief Judge the transcripts and only alleged that the conversations "concern" a hidden interest in the Aladdin hotel-casino. This language is consonant with the investigators' view that somehow the machinations involving the "golf course" property also concerned a hidden interest in the Aladdin. Nothing in the transcripts is inconsistent with this view and, given the veiled nature of the discussions, the government could hardly be expected to have defined the connection more explicitly. Finally, two additional pieces of evidence support the finding that the investigators truly believed a link existed between all the conversations contained in the March 1 application: summaries of the "bid" conversations were coded into FBI files on both the Aladdin and "golf course" properties; and a telegram sent from the FBI's Chicago office to the Director on February 14, 1979, stated that the "bid" calls "related to" the Aladdin.

The defendants argue, nevertheless, that the government was constitutionally obliged to make a "complete and total disclosure" to the Chief Judge. Accordingly, they conclude, the government's failure to inform the Chief Judge that the "bid" in the ...


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